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2016 (3) TMI 1045 - CESTAT MUMBAI

2016 (3) TMI 1045 - CESTAT MUMBAI - TMI - Interest on refund - refund claim sanction - Held that:- The refund claim was filed on 17.12.2005 and the same was sanctioned within three months from the date of filing the refund claim and, therefore, as per Section 11BB, the assessee is not entitled to claim interest from the date when the alleged amount was deposited during investigation. - As decided in Union of India & Others Versus M/s Hamdard (Waqf) Laboratories [2016 (3) TMI 68 - SUPREME CO .....

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t have any bearing or connection with the date from which interest under Section 11BB of the Act becomes payable - Decided against assessee - Appeal No. E/2765/06-Mum - A/86425/16/EB - Dated:- 9-3-2016 - MR. S.S. GARG, MEMBER (JUDICIAL) AND MR. RAJU, MEMBER (TECHNICAL) For the Petitioner : Shri Ajay Kumar, Joint Commissioner (AR) For the Respondent : Shri Mohan V. Goswami, Consultant ORDER PER: S.S. GARG The present appeal is directed against the order of the Commissioner (Appeals), dated 29.5.2 .....

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al of scented tobacco and during the course of investigation, the assessee had paid total of ₹ 1,00,00,000/- vide four TR-6 challan. A show cause notice dated 29.3.2001 was issued by the DGCEI, Mumbai, to the assessee and others. The Commissioner (Adjudication), Central Excise, Mumbai, confirmed the show cause notice for duty amount of ₹ 4,86,96,400/- against the assessee and appropriated the amount of ₹ 1 crore paid by them and also imposed equal penalty of ₹ 4,86,96,400 .....

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by the assessee was rejected by him. Against the said order, the assessee filed appeal before the Commissioner (Appeals) who has set aside the order-in-original and allowed the appeal of the assessee for grant of interest as claimed by the assessee. Against the said order of the Commissioner (Appeals), the department has filed the present appeal. 3. The learned AR submitted that in this case, the refund claim was filed on 17.12.2005 and the same was sanctioned and paid to the assessee within th .....

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iate the controversy, it is pertinent to reproduce the statutory provisions governing the refund and the interest on delayed refund. The said provisions read as under:- "Section 11B. Claim for refund of duty and interest, if any, paid on such duty- (1) Any person claiming refund of any duty of excise and interest, if any, paid on such duty may make an application for refund of such duty and interest, if any, paid on such duty to the Assistant Commissioner of Central Excise or Deputy Commiss .....

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y, paid on such duty had not been passed on by him to any other person: Provided that where an application for refund has been made before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991, such application shall be deemed to have been made under this sub-section as amended by the said Act and the same shall be dealt with in accordance with the provisions of sub-section (2) substituted by that Act: Provided further that the limitation of one year shall not apply wher .....

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f any, paid on such duty as determined by the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise]under the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to - (a) rebate of duty of excise on excisable goods exported out of India or on excisable materials used in the manufacture of goods which are exported out of India; (b) unspent advance deposits lying in balance in the a .....

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by the buyer, if he had not passed on the incidence of such duty and interest, if any, paid on such duty to any other person; (f) the duty of excise and interest, if any, paid on such duty borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette, specify: Provided further that no notification under clause (f) of the first proviso shall be issued unless in the opinion of the Central Government the incidence of duty and interest, if any, pa .....

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11-BB. Interest on delayed refunds.- If any duty ordered to be refunded under sub-section (2) of section 11B to any applicant is not refunded within three months from the date of receipt of application under sub-section (1) of that section, there shall be paid to that applicant interest at such rate, not below five per cent and not exceeding thirty per cent per annum as is for the time being fixed by the Central Government, by Notification in the Official Gazette, on such duty from the date imm .....

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ate immediately after three months from such date, till the date of refund of such duty. Explanation.- Where any order of refund is made by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or any court against an order of the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, under sub-section (2) of section 11B, the order passed by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or, as the case may be, by the court shall .....

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submitted that in the present case, the refund has been sanctioned within three months from the date of refund application and, therefore, the order passed by the Assistant Commissioner is absolutely correct and is in accordance with law. The learned AR also relied upon the following decisions:- (i) Jayant Glass India Pvt. Ltd. vs. CCE, Kolkata reported in 2003 (155) ELT 188 (Tri.-LB); (ii) Prempreet Textile Industries Ltd. vs. UOI reported in 2013 (293) ELT 523 (Guj.); (iii) Galaxy Entertainme .....

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(ii) Toyota Kirloskar Auto Parts Pvt. Ltd. vs. CC, Bangalore reported in 2009 (240) ELT 124 (Tri.-Bang.). 5. We have heard the learned counsel for the parties and perused the material on record carefully and also gone through the statutory provisions for grant of interest on refund. 6. It is a fact that in this case, the refund claim was filed on 17.12.2005 and the same was sanctioned within three months from the date of filing the refund claim and, therefore, as per Section 11BB, the assessee i .....

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Sub-section (2) of Section 11-B stipulates filing of an application by the assessee before the competent authority. It also postulates that the said authority is required to be satisfied that the whole or any part of the duty of excise and interest, if any, paid on such duty is refundable. The application, as submitted by Mr. Adhyaru, has to be an application in law. Section 11-BB which deals with interest on delayed refund clearly and categorically predicates that if any duty ordered to be ref .....

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application was filed on 25th August, 1999. The said application, needless to emphasise, was preferred under sub-section (2) of Section 11-B. We have been apprised of the circular dated 30th May, 1995. It deals with interest of delayed refund under Section 11-BB. Paragraph 2 of the said circular being relevant is reproduced below:- "2. Keeping the above in view, the following instructions are being issued regarding refunds claimed under section 11 BB of CE & SA, 1944:- (a) Refund applic .....

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cknowledgment should be issued immediately after the above mentioned verification which will be an evidence of the receipt of refund application in terms of Section 11-BB. The period of 3 months in terms of Section 11-BB shall be counted from the date following the date of receipt of refund application up to the date of dispatch of cheque for refund. (e) The Collector should direct the Divisional Assistant Collector to designate an officer by name who will carry out the initial verification and .....

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om the date of receipt of all the requisite information or documents. (h) The Collector may use a cyclostyled Performa for the purpose of intimating the deficiencies or for acknowledgment of the receipt of the refund application. (I) Check-lists of various documents which should be filed with the refund claims of different types are annexed herewith to be used as guidelines. However, the list may not be treated as exhaustive and any other documents, if required, may be included therein and calle .....

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t interest under the said Section becomes payable on the expiry of a period of three months from the date of receipt of the application under Sub-section (1) of Section 11B of the Act and that the said Explanation does not have any bearing or connection with the date from which interest under Section 11BB of the Act becomes payable. [Emphasis supplied] 18. While dealing with the said facet, the Court also referred to circular dated 01.10.2002 issued by the Central Board of Excise and Customs, Ne .....

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